New Frontiers in Technical Analysis

[mitsubishi]

That caught your eye did it not? At the very least i hope to bring you an interesting experiment in which you are very welcome to contribute. Now,it's true that there is nothing more hazardous to your account than a trader with half an idea,but we are always interested in attempting to reveal something in the market that was hidden(the best place to hide something is in plain view) But as this is a work in progress i am not trading it.I just thought it might be interesting to develop an idea in public for a change and your imput could take this in directions it would not go working alone. Well that's the sizzle but what about the sausage?!
The idea is based on the premise that (1) we don't know where the market is going but we do know where it has been. (2) The market seems to react to trendlines,but your trendlines are different to somebody else's trendlines so it's very subjective. (3) markets may be geometrical/mathmatical/cyclical based on a set of rules not yet discovered. (4) price and time may be connected.
The idea is also that similar results/conclusions can be drawn using different methods in the same way that 2+2=4 as does 1+3=4; in the same way that conventional trendlines might converge at a fib ratio and/or pivot/sup/res therefore making a reaction in that area more likely. So if we can think outside the box and end up with a new tool that can be used as additional confirmation in conjunction with conventional tools,that would be great.But if we could could come up with something that explains why the conventional sometimes doesn't work that would be even better- (and would help to justify my rather ambitious title!)
Don't be afraid to contribute if you are just starting out,newcomers often have good ideas since they haven't been drowned in conventional wisdom,and even an innocent question can lead to interesting avenues.

Naturally,i will get the ball rollin along with a chart or 2 ..............

[mitsubishi]

Now you tell me guys,cos i been up all night working on this,have you ever seen a chart like this before.....

[mitsubishi]

'You know,so much of the time we're just lost.You say,please god,tell us what is right,tell us what is true.And there is no justice.The rich win,the poor are powerless.We become tired of hearing people lie.And after a time we become dead.We think of ourselves.. as victims.And we become victims.We doubt ourselves,we become weak.We doubt our institutions.And we doubt the law......' Do you also notice how the ohlc turns,almost without exception are sharp,and, more importantly,fleeting.What i mean is,you have almost no time to get aboard a decent reversal.This model is NOT about FOLLOWING price,attempting to contain it in channels or conventional trend lines.It is more about doing what most traders fear to attempt most- calling tops and bottoms and reversals.We are looking at angles repeating and projecting rather than patterns.
Now imagine price is a train that only stops at the station for 30 seconds to a couple of minutes.Most of you are gonna miss it BUT for those that catch it, the journey will start immediately and the destination arrived at quicker.(ever been in a trade so long you just scratch it cos you no longer know which way it will go? Ever get on board a trend just when its starting to reverse when you thought it was a pullback?)
The only way to catch this train is to already be at the station before it arrives.
Will the people who think the market is random explain to me how the most important prices everyday (ohlc) are connected by perfectly geometrical lines in my chart?
Luck/coincidence? Take another look at the price levels AT THE TURNS... and IN SEQUENCE 926 946 936 946 926 956 946 936 946.
Take a look at the sequence of how the highs and lows come together in a cycle- high low high low high higher high (slight) low high low lower low high. Its mainly a series of V or A shapes. Now, what about the timing of the turns?
Usually we get a morning high, a mid day low,an afternoon high (V shape).Or a morning low,mid day high,an afternoon low (A shape) Or a trending day- low,high,higher high (uptrend) or- high,low.lower low (downtrend) A Sideways day will still have a V or A shape.And also note that a trend day is actually an A shape or V shape until the last third.As always,what happened yesterday/before can tell us a lot about what might happen today.These are the only possibilities.... 'there is no other case,this is the case.There is no other case,,this is the case'

Will be interesting to see how this pans out going into todays trading and the rest of the week.Futures are in the red overnight and 956 week high was quickly rejected on thursday.926.4 was week low and we closed fri at 946.2.Resistance is 961 support 935/ 912 (elliott wave) we need those geometric lines to indicate when and where the levels come in and reverse....
....'well today you are the law. You ARE the law.Not some book....' (Paul Newman,The Verdict 1982)

[Frank]

I assume you meant to write 45 degree angle and not 90 degree.

[Frank]

let me just understand what is going on here first.

looks like your chart is 1-min pit session data and the 45 degree line is organized such that it rises or falls 2 points every hour. So if the low or high is made on the open (930), the line will extend 6.5 x 2 by end of day = 13 pts. The point change will be driven by the time increment of the chart, in this case in blocks of 2 points per 1 hour, 1 point per 1/2 hour.

The first issue I see is that your chart is linear --- while market movement is mostly non-linear.

[mitsubishi]

Originally Posted by Frank let me just understand what is going on here first. looks like your chart is 1-min pit session data and the 45 degree line is organized such that it rises or falls 2 points every hour. So if the low or high is made on the open (930), the line will extend 6.5 x 2 by end of day = 13 pts. The point change will be driven by the time increment of the chart, in this case in blocks of 2 points per 1 hour, 1 point per 1/2 hour. The first issue I see is that your chart is linear --- while market movement is mostly non-linear.

ok bear with me as i really have only had 4 hours sleep in the last 2 days frank im not the most tech minded guy on the board by a looong way.1 point per 1/2 hour was what i used to get when i hand drew charts on graph paper using a 45 deg angle so what you say sounds right to me.But can you unconfuse(?) me about my/your idea of 45 deg (i have put one on that chart below)

[UrmaBlume]

Originally Posted by Frank I assume you meant to write 45 degree angle and not 90 degree.

Frank,

I believe that the 90 degree angle the OP refers to is off the line from the open to the low and not the horizontal.

If the original reference line is always from the open to the low then the initial projection line will always be up as, unless the open = low, the first line will slope down and a right angle to that is always going to be up.

I must have missed something.

[BlowFish]

For this to make sense one would need properly (fixed) scaled charts right? What Gann aficionado might call squaring price and time?

[mitsubishi]

[quote=BlowFish;67914]For this to make sense one would need properly (fixed) scaled charts right? What Gann aficionado might call squaring price and time?[/QUOTE

Yes,in the past i would do this by hand but it is tedious so i have tried it this way to see what happens. When i squared price and time on graph paper it was as frank said 1 point per 1/2 hour which i got by luck more than design.then i found that all the highs and lows could be connected by 45 deg angles based on the horizontal

[mitsubishi]

Originally Posted by UrmaBlume Frank, I believe that the 90 degree angle the OP refers to is off the line from the open to the low and not the horizontal. If the original reference line is always from the open to the low then the initial projection line will always be up as, unless the open = low, the first line will slope down and a right angle to that is always going to be up. I must have missed something.

I should make something clear here first.Dont get hung up on the open or any ohlc point now because i have reversed engineered the chart so the geometry looks right (to me) hoping for the result which i got.You will notice that the second chart i posted in answer to frank has a 45 deg based on the horizontal and you can see that it only connects 2 target data points and would not work like that for the others.So my conclusion is my original plan should be persued since it looks right and works.
So going forward i would connect todays ohlc points and project forward as before or /and connect to the first chart and see what we get.Anyway we will see what i get end of play unless i spot something before session ends.
Thanks for all the initial interest guys keep it coming